Trademarks

17 Feb 2016

Trademark
A trademark is a tool used to differentiate goods
and services from each other
Mark means any visible sign capable of disti
nguishing the goods (trademark) or services (ser
vice mark) of an enterprise and shall include a st
amped or marked container of goods (Sec.121.
1)
Trade Name means the name or designatio
n identifying or distinguishing an enterprise (Sec
. 121.3)

Trade Names (Sec. 165)

Name or designation may not be used if:
Contrary to public order or morals
Liable to deceive trade circles or the public as to the NATURE
of the enterprise

Such names shall be protected even prior to or without

registration as against an unlawful act by third parties
Use of a trade name by a third party likely to mislead th
e public shall be deemed unlawful
Change in ownership of trade name shall be made upo
n transfer of enterprise or part thereof identified by tha
t name

CONVERSE VS. UNIVERSAL RU

BBER

Facts
Universal Rubber Products filed an application for r
egistration of the trademark Universal Converse a
nd Device used on rubber shoes and slippers
Converse filed an opposition alleging the following:
Confusingly similar to Converse which is part of petitio
ners corporate name and thus, likely to deceive purchas
ers of products
Registration of respondents trademark will cause great
and irreparable injury to the business reputation, and g
oodwill of petitioner

Issue
Whether or not the respondent's partial ap
propriation of petitioner's corporate name i
s of such character that it is calculated to de
ceive or confuse the public to the injury of t
he petitioner to which the name belongs?

Held
No. Converse Rubber has earned a business reputation and go
odwill in the Philippines. The word converse has been associ
ated with its products, converse chuck Taylor, Converse all S
tar, All Star Converse Chuck Taylor, or Converse Shoes Chuc
k and Taylor. Converse has grown to be identified with Conv
erse rubber products and has acquired a second meaning wit
hin the context of trademark and tradename laws. There is co
nfusing similarity between Universal converse and Device an
d Converse chuck Taylor and All Star Device which would c
onfuse the public to the prejudice of Converse Rubber inasmu
ch as Universal Converse and Device is imprinted in a circula
r manner on the side of its rubber shoes, similar to that of Co
nverse Chuck Taylor.

PHILIPS EXPORT BV VS CA

Facts
Philips Export BV is a foreign corporation organized in Netherla
nds and not engaged in business in the Philippines.
It is the registered owner of the trademark Phillips and Philli
ps Shield Emblem. Philips Electrical Lamp, Inc. and Philips Ind
ustrial Development Inc. besides PEBV, are corporations belong
ing to the Philips Group of Companies.
In 1984, PEVB filed a letter-complaint with the SEC for the canc
ellation of the word Phillips from Standard Philips corporate
name.
The SEC en banc affirmed the dismissal of PEBUs complaint by
one of its hearing officers. The Court of Appeals dismissed PEV
Bs petition for review certiorari, as referred by the Supreme Co
urt

Issue
Whether or not there is confusing similarity
between the corporate names to warrant th
e removal of Philips in Standard Philips c
orporate name?

 Yes. The right to exclusive use of a corporate name with freedom from infrin
gement by similarity is determined by priority of adoption. PEBV, et al. have
priority in adoption, as Standard Philips was issued a Certificate of Registrati
on 26 years after Philips Electrical and Philips Industrial acquired theirs. A re
ading from said corporate names, it is obvious that Philips is the dominant
word in all companies affiliated with the principal corporation, PEVB. Given t
hat standard Philips primary purpose does not prevent it from dealing in th
e same line of business of electrical devices, products or supplies, as that of
Philips Electrical, it can only be said that the subsequent appropriator of the
name or one confusingly similar thereto usually seeks an unfair advantage,
a free ride on anothers goodwill. Inasmuch as Standard Philips has submitt
ed an undertaking to the SEC manifesting its willingness to change its corpo
rate name in the event another person, firm or entity has acquired a prior ri
ght to the use of the said firm name or one deceptively or confusingly simila
r to it. Standard Philips must now be held in its undertaking.

TRADEMARK DISTINCTIVENESS:
THE SPECTRUM APPROACH

Fanciful Marks
Afanciful/inherently distinctivetrademark
isprima facieregistrable, and comprises an en
tirely invented or "fanciful" sign.
For example, Kodak had no meaning before i
t was adopted and used as a trademark in relat
ion to goods, whether photographic goods or o
therwise.
Invented marks are neologismswhich will not
previously have been found in anydictionary.

Arbitrary Marks
Anarbitrarytrademark is usually a common word which is
used in a meaningless context
Such marks consist of words or images which have some di
ctionary meaning before being adopted as trademarks, but
which are used in connection with products or services unr
elated to that dictionary meaning.
Arbitrary marks are also immediately eligible for registratio
n.
Saltywould be an arbitrary mark if it used in connection wit
h e.g. telephones such as inSalty Telephones, as the term
salt has no particular connection with such products.
Eg: APPLE computers

Suggestive marks
Asuggestivetrademark tends to indicate the n
ature, quality, or a characteristic of the product
s or services in relation to which it is used, but
does not describe this characteristic, and requir
es imagination on the part of the consumer to i
dentify the characteristic.
Suggestive marks invoke the consumers percep
tive imagination. An example of a suggestive m
ark is Blu-ray, a new technology of high-capacit
y data storage.

Descriptive Marks
Adescriptivemark is a term with a dictionary meanin
g which is used in connection with products or service
s directly related to that meaning.
An example might beSaltyused in connection with sa
ltine crackers or anchovies.
Such terms are not registrable unless it can be shown
that distinctive character has been established in the t
erm through extensive use in the marketplace.
Eg: Lektronicwas famously refused protection by the
USPTO on the grounds of being descriptive for electro
nic goods.

Generic terms
Ageneric termis the common name for the products or servi
ces in connection with which it is used, such as "salt" when use
d in connection with sodium chloride.
A generic term is not capable of serving the essential trademar
k function of distinguishing the products or services of a busine
ss from the products or services of other businesses, and there
fore cannot be afforded any legal protection.
This is because there has to be some term which may generally
be used by anyoneincluding other manufacturersto refer t
o a product without using some organization's proprietary trad
emark.
Marks which become generic after losing distinctive character a
re known as genericized trademarks.

(Sec. 123.1)

UNREGISTRABLE MARKS:
A MARK CANNOT BE REGISTERED IF

 (a) Consists of immoral, deceptive or scandalous matter, o

r matter which may disparage or falsely suggest a connecti
on with persons, living or dead, institutions, beliefs, or nati
onal symbols, or bring them into contempt or disrepute;
(b) Consists of the flag or coat of arms or other insignia of
the Philippines or any of its political subdivisions, or of any
foreign nation, or any simulation thereof;
(c) Consists of a name, portrait or signature identifying a p
articular living individual except by his written consent, or
the name, signature, or portrait of a deceased President of
the Philippines, during the life of his widow, if any, except
by written consent of the widow;

 (d) Is identical with a registered mark belo

nging to a different proprietor or a mark
with an earlier filing or priority date, in re
spect of:
(i) The same goods or services, or
(ii) Closely related goods or services, or
(iii) If it nearly resembles such a mark as to b
e likely to deceive or cause confusion;

 (e) Is identical with, or confusingly similar to, or constitu

tes a translation of a mark which is considered by the co
mpetent authority of the Philippines to be well-known in
ternationally and in the Philippines, whether or not it is
registered here, as being already the mark of a person o
ther than the applicant for registration, and used for ide
ntical or similar goods or services: Provided, That in det
ermining whether a mark is well-known, account shall b
e taken of the knowledge of the relevant sector of the p
ublic, rather than of the public at large, including knowle
dge in the Philippines which has been obtained as a res
ult of the promotion of the mark;

 (f) Is identical with, or confusingly similar to, or consti

tutes a translation of a mark considered well-known i
n accordance with the preceding paragraph, which is
registered in the Philippines with respect to goods or
services which are not similar to those with respect t
o which registration is applied for: Provided, That use
of the mark in relation to those goods or services wo
uld indicate a connection between those goods or ser
vices, and the owner of the registered mark: Provided
further, That the interests of the owner of the registe
red mark are likely to be damaged by such use;

 (g) Is likely to mislead the public, particularly as t

o the nature, quality, characteristics or geograph
ical origin of the goods or services;
(h) Consists exclusively of signs that are generic f
or the goods or services that they seek to identif
y;
(i) Consists exclusively of signs or of indications t
hat have become customary or usual to designat
e the goods or services in everyday language or i
n bona fide and established trade practice;

 (j) Consists exclusively of signs or of indications that m

ay serve in trade to designate the kind, quality, quantit
y, intended purpose, value, geographical origin, time o
r production of the goods or rendering of the services,
or other characteristics of the goods or services;
(k) Consists of shapes that may be necessitated by tech
nical factors or by the nature of the goods themselves
or factors that affect their intrinsic value;
(l) Consists of color alone, unless defined by a given for
m; or
(m) Is contrary to public order or morality.

 Section 126.Disclaimers. - The Office may allow o

r require the applicant to disclaim an unregistrabl
e component of an otherwise registrable mark but
such disclaimer shall not prejudice or affect the ap
plicant's or owner's rights then existing or thereaft
er arising in the disclaimed matter, nor such shall
disclaimer prejudice or affect the applicant's or ow
ner's right on another application of later date if t
he disclaimed matter became distinctive of the ap
plicant's or owner's goods, business or services

PROTECTION OF WELL KNOWN

MARKS

Sec. 123.1
(e) Is identical with, or confusingly similar to, or constitutes a translation of a mark
which is considered by the competent authority of the Philippines to be well-know
n internationally and in the Philippines, whether or not it is registered here, as bei
ng already the mark of a person other than the applicant for registration, and used
for identical or similar goods or services: Provided, That in determining whether a
mark is well-known, account shall be taken of the knowledge of the relevant sector
of the public, rather than of the public at large, including knowledge in the Philippi
nes which has been obtained as a result of the promotion of the mark;
(f) Is identical with, or confusingly similar to, or constitutes a translation of a mark
considered well-known in accordance with the preceding paragraph, which is regis
tered in the Philippines with respect to goods or services which are not similar to t
hose with respect to which registration is applied for: Provided, That use of the ma
rk in relation to those goods or services would indicate a connection between thos
e goods or services, and the owner of the registered mark: Provided further, That t
he interests of the owner of the registered mark are likely to be damaged by such
use;

RULE 102. Criteria for determining whether a mark is well-known. - In

determining whether a mark is well-known, the following criteria or a
ny combination thereof may be taken into account:
(a) the duration, extent and geographical area of any use of the mark, in particular, the dur
ation, extent and geographical area of any promotion of the mark, including advertising or
publicity and the presentation, at fairs or exhibitions, of the goods and/or services to which
the mark applies;
(b) the market share, in the Philippines and in other countries, of the goods and/or services
to which the mark applies;
(c) the degree of the inherent or acquired distinction of the mark;
(d) the quality-image or reputation acquired by the mark;
(e) the extent to which the mark has been registered in the world;
(f) the exclusivity of registration attained by the mark in the world;
(g) the extent to which the mark has been used in the world;
(h) the exclusivity of use attained by the mark in the world;
(i) the commercial value attributed to the mark in the world;
(j) the record of successful protection of the rights in the mark;
(k) the outcome of litigations dealing with the issue of whether the mark is a well-known m
ark; and,
(l) the presence or absence of identical or similar marks validly registered for or used on id
entical or similar goods or services and owned by persons other than the person claiming t
hat his mark is a well-known mark.

SEHWANI VS. IN-AND-OUT BU

RGER

Facts
Petitioner IN-N-OUT BURGER, INC., is a business entity incorpora
ted under the laws of California. It is a signatory to the Conventio
n of Paris on Protection of Industrial Property and the TRIPS Agre
ement. It is engaged mainly in the restaurant business, but it has
never engaged in business in the Philippines.
Respondents Sehwani, Incorporated and Benita Frites, Inc. are co
rporations organized in the Philippines. Sometime in 1991, Sehw
ani filed with the BPTTT an application for the registration of the
mark IN N OUT (the inside of the letter O formed like a star). It
s application was approved and a certificate of registration was is
sued in its name on 1993. In 2000, Sehwani, Incorporated and Be
nita Frites, Inc. entered into a Licensing Agreement, wherein the f
ormer entitled the latter to use its registered mark, IN N OUT.

Facts
Sometime in 1997, In-N-Out Burger filed trademark and service mark
applications with the Bureau of Trademarks for the IN-N-OUT and I
N-N-OUT Burger & Arrow Design. In 2000, In-N-Out Burger found out
that Sehwani, Incorporated had already obtained Trademark Registrat
ion for the mark IN N OUT (the inside of the letter O formed like a s
tar). Also in 2000, In-N-Out Burger sent a demand letter directing Seh
wani, Inc. to cease and desist from claiming ownership of the mark I
N-N-OUT and to voluntarily cancel its trademark registration. Sehwan
i Inc. did not accede to In-N-Out Burgers demand but it expressed its
willingness to surrender its registration for a consideration.
In 2001 In-N-Out Burger filed before the Bureau of Legal Affairs an ad
ministrative complaint against the Sehwani, Inc. and Benita Frites, Inc.
for unfair competition and cancellation of trademark registration.

Issues
Whether or not the Respondent has the le
gal capacity to sue for the protection of it
s trademarks albeit it is not doing busines
s in the Philippines?
Whether or not a ground exists for the ca
ncellation of the Petitioners registration?

Held
Yes. Section 160 RA No. 8293 provides for the right of foreign corporations to sue in trademark or servic
e mark enforcement action, provided that it meets the requirements under Section 3 thereof, which are:
a.Any convention, treaty or agreement relation to intellectual property right or the repression of unf
air competition wherein Philippines is also a party; and
b.An extension therein of reciprocal rights.
Moreoever, Article 6bis of The Paris Convention, which governs the protection of well-known trademarks
, is a self-executing provision and does not require legislative enactment to give it effect in the member c
ountry. The essential requirement therein is that the trademark must be well-known in the country whe
re protection is sought. In this case, Director Beltran-Abelardo found that In-n-out Burger and Arrow De
sign is an internationally well0known mark as evidenced by its trademark registrations around the world
and its comprehensive advertisements therein.
Yes. Section 151(b) of RA 8293 provides that a petition to cancel a registration of a mark may be filed wit
h the Bureau of Legal Affairs by any person who believes that he is or will be damaged by the registratio
n of a mark at any time, if the registered mark becomes the generic name for the goods or services, or a
portion thereof, for which it is registered, or has been abandoned, or its registration was fraudulently or
contrary to the provisions of this Act, or if the registered mark is being used by or with the permission of,
the registrant so as to misrepresent the source of goods or services on or in connection with which the
mark is used. The evidence showed that not only did the petitioners use the IN-N-OUT Burger trademar
k for the name of their restaurant, but they also used identical or confusingly similar mark for their ham
burger wrappers and French-fries receptacles, thereby effectively misrepresenting the source of the goo
ds and services.